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Monday, 24 December 2012

Council Regulation 44/2001 of 22 December 2000 on jurisdiction and the recog­nition and enforcement of judgments in civil and commercial matters has now been recast: prepare to welcome Regulation 1215/2012 of the European Parliament and of the Council of 12 December 2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, the full text of which waspublished on the websiteof the Official Journal of the European Union last week.

To refresh your memories, while the Regulation unsurprisingly deals with many other areas than IP, there are some IP-specific bits that should not be ignored. Recital 25 in the Preamble reads:

(25) The notion of provisional, including protective, measures
should include, for example, protective orders aimed at
obtaining information or preserving evidence as referred
to in Articles 6 and 7 of Directive 2004/48/EC of the
European Parliament and of the Council of 29 April
2004 on the enforcement of intellectual property
rights. It should not include measures which are not
of a protective nature, such as measures ordering the
hearing of a witness. This should be without prejudice
to the application of Council Regulation (EC)
No 1206/2001 of 28 May 2001 on cooperation
between the courts of the Member States in the taking
of evidence in civil or commercial matters.

So far as the substantive provisions of the Regulation are concerned, patents get a special mention in Article 24:

Exclusive jurisdiction

Article 24

Another piece of EUlaw gets cleaned up

The following courts of a Member State shall have exclusive
jurisdiction, regardless of the domicile of the parties:

(1) in proceedings which have as their object rights in rem in
immovable property or tenancies of immovable property,
the courts of the Member State in which the property is
situated.

However, in proceedings which have as their object
tenancies of immovable property concluded for temporary
private use for a maximum period of six consecutive
months, the courts of the Member State in which the
defendant is domiciled shall also have jurisdiction,
provided that the tenant is a natural person and that the
landlord and the tenant are domiciled in the same Member
State;

(2) in proceedings which have as their object the validity of the
constitution, the nullity or the dissolution of companies or
other legal persons or associations of natural or legal
persons, or the validity of the decisions of their organs,
the courts of the Member State in which the company,
legal person or association has its seat. In order to
determine that seat, the court shall apply its rules of
private international law;

(3) in proceedings which have as their object the validity of
entries in public registers, the courts of the Member State
in which the register is kept;

(4) in proceedings concerned with the registration or validity of
patents, trade marks, designs, or other similar rights
required to be deposited or registered, irrespective of
whether the issue is raised by way of an action or as a
defence, the courts of the Member State in which the
deposit or registration has been applied for, has taken
place or is under the terms of an instrument of the
Union or an international convention deemed to have
taken place.

Without prejudice to the jurisdiction of the European Patent
Office under the Convention on the Grant of European
Patents, signed at Munich on 5 October 1973, the courts
of each Member State shall have exclusive jurisdiction in
proceedings concerned with the registration or validity of
any European patent granted for that Member State;

(5) in proceedings concerned with the enforcement of judg­ments, the courts of the Member State in which the
judgment has been or is to be enforced.

If the experience of patent litigators is anything like that of their trade mark brethren, the old, un-recast version of the Regulation will continue to be cited for years.

Saturday, 22 December 2012

PatLit thanks Freshfields Bruckhaus Deringer trainee Mari Brennan for preparing the note, below, on Daniel Alexander QC's review of the year's patent law developments in England and Wales. This review, hosted in the London office of Hogan Lovells, was organised by the UK cell of AIPPI.

Tuesday evening saw Daniel Alexander QC present a round-up
of 2012’s important developments in patent case-law to an audience of over 100
professional IP enthusiasts, aided (in Mr Alexander’s words) by an
“unbelievably long and boring” handout.

1.Substantive law developments

Construction:Schenck Rotec GmbH v Universal Balancing
Limited [2012] EWHC 1920 (Pat) saw HHJ Birss adopt a contextual approach in the
construction of “suitable for”, emphasising that interpretation in the context
of a use claim will be different from interpretation in a method claim. the
difference between “for” and “suitable for”.
This approach was commended by Mr Alexander, who commented that judges
should not unduly disregard the context in which a patent operates and forget
what the patent is about.

Common general
knowledge: BOS GmbH & Co KG v
Cobra UK Automative Products Division Ltd [2012] EWPCC 38 and HTC Europe Co Ltd v Apple Inc [2012]
EWHC 1789 (Pat) highlighted that a skilled person’s knowledge of a product’s
existence is to be distinguished from a skilled person’s knowledge of the
internal workings of the product. The
question is one of fact. For example, if
a product’s workings can be easily found out by a skilled person looking at a
piece of prior art, then it may be considered to be common general knowledge.

Obvious to
try/expectation of success: Mr Alexander suggested watching this space for
future developments. There is currently
tension in judicial thinking.

On one hand, there was general further elaboration of what
level of expectation of success is required to render something “obvious to
try”. For example, in Regeneron Pharmaceuticals Inc v Genetech Inc
[2012] EWHC 657 (Pat) it was explained that this means a “fair expectation
of success”. However, Lewison LJ inMedimmune Ltd v Novartis
Pharmaceuticals UK Ltd & Ors [2012] EWCA Civ 1234 retreated from the
“obvious to try” approach altogether, seemingly rejecting the doctrines and
sub-doctrines that have developed around the statutory question. He asserted that “too much elaboration” had
been given to the simple statutory question of whether an invention was obvious
as at the priority date.

Lack of technical
contribution: A sub-body of jurisprudence is developing out of Agrevo.
It is open to review as to whether this is appropriate. The concept is extremely complicated as
regards burden of proof etc. as demonstrated by Generics v Yeda Research and Development Co Ltd [2012] EWHC 1848 (Pat). Mr Alexander recommended watching this space
for further development…

Excluded
subject-matter: This is also an area that Mr Alexander considers ripe for
further consideration. The Court of
Appeal in Symbian said that you have
to identify the technical contribution made and decide if the contribution lies
solely in excluded subject matter. But
what is the baseline for determining the contribution? Floyd J’s opinion in HTC Europe Co Ltd v Apple Inc is that
the question of determining the contribution should be same as the principles
involved in determining the difference between prior art and the inventive
concept for the purposes of obviousness, but the baseline remains unclear.

Added matter:Liversidge v Owen Mumford [2012] EWPCC
33 emphasised the importance of not stretching disclosure away from its
original context. Third parties are
entitled to legal security; they should be able to rely on the disclosure as
presented on the face of things, and not worry about it any further than its
original context.

2. Supplementary Protection Certificates

Meaning of Article 3(a)
“protected by the patent”: There is confusion over whether a product is
“specified in the patent” as per the principle laid down by the CJEU in Medeva.
The confusion was highlighted in Novartis
Pharmaceuticals UK Ltd v Medimmune Ltd & Amor [2012] EWHC 181, Medeva BV v Comptroller General of Patent [2012]
EWCA Civ 523 and Lilly & Company v
Human Genome Sciences Inc [2012] EWHC 2290.

The CJEU’s stance is that a principle has been laid down,
and that it is not the Court’s place to micro-manage the application of the
principle. Mr Alexander commented that this
approach will lead to differences in application in each of the Member State
national courts, causing confusion contrary to the principle of
harmonisation.

Meaning of Article
3(c) – multiple applications based on the same patent: 2012 saw a
divergence in opinion between the British and Dutch Patent Offices. The UK IPO’s interpretion of the CJEU in Medeva is that SPCs can be granted in
respect of multiple applications based on the same patent, where the SPCs
relate to different products. The Dutch
approach prohibits the grant of more than one SPC per patent regardless of the
number of products claimed in the basic patent.
A referral was therefore made in Actavis
Group v Sanofi Pharma Bristol-Meyers Squibb SNC [2012] EWHC 2454 (Pat).

2.Procedural developments and Remedies

Negative
declarations: In Lilly & Company
v Human genome Sciences Inc [2012] EWHC 2290, Lilly sought a declaration
that once a market authorisation has been granted, a third party cannot obtain
an SPC at all. This was denied, but
there is an inconsistent approach towards negative declarations, demonstrated
for example, by Arnold J’s approach favouring negative declarations in Actavis v Eli Lilly. The area is therefore ripe for CJEU
consideration.

Costs and costs
capping:Syngenta Ltd & Ors v
Chemsource Ltd [2012] EWHC 1507 (Pat) represented the first ever cost
capping decision in the context of patent claims. However, the Court was cautious, highlighting
that in the wrong hands, such orders can be used to work injustice. For example a party benefitting from a costs
order may act so that the other party incurs large irrevocable costs and will
be induced to settle on more attractive terms.

Costs where the
winner runs many losing points: The Court gave no order as to costs inMMI
Research Ltd v Cellxion Ltd & Ors [2012] EWCA Civ 139, reasoning that a
strict costs regime should make a party concentrate on his best arguments.

Publicity of
judgments: Mr Alexander approved of
HHR Birss QC’s judgment in BOS GmbH &
Co KG v Cobra UK Automative Products Division [2012] EWPCC 44, in which he
highlighted that the Court’s discretion as to whether to grant a remedy such as
a declaration will be considered on the facts in every case, including the fact
that both sides have the ability to publicise a judgment.

Friday, 21 December 2012

Anyone litigating patents in England and Wales may want to take a quick look at the recently-revised list of Patents Court judges below, culled from the Patents Court Guide. The list, updated earlier this month, now includes Mr Justice Roth.

Some of the judges listed above are genuine members of the IP community, having practised at the patent bar and possessing something of a science background. Some of the others have come to IP relatively late in life and, however good their judgments may be, have remained regrettably aloof from the wonderful world of IP. This blogger hopes that eventually their reticence will evaporate.

Wednesday, 19 December 2012

On
December 17, the U.S. District Court for the Northern District of California
ruled on Apple’s motion for a permanent injunction blocking Samsung from
selling 26 devices found by a jury to infringe Apple’s design and utility
patents and to dilute Apple’s trade dress. Applying the Federal Circuit’s
directive in a prior appeal at the preliminary injunction stage, see Apple, Inc.v. Samsung Electronics Co.,
695 F.3d 1370 (Fed. Cir. 2012)("Apple II"), District Judge Lucy H. Koh denied the motion. A
few key points in the ruling, which is available here:

First,
although Apple established that Samsung smartphone sales had impacted Apple’s market
share, Apple failed to establish a specific causal nexus between that competitive
injury and the specific claims Samsung has been found to infringe. In the earlier
appellate decision, the Federal Circuit stated that in order the establish
irreparable harm, one of the equitable factors to be considered in awarding
permanent injunctive relief under eBay
Inc. v. MerchExchange, LLC, “a patentee must establish both of the following
requirements: 1) that absent an injunction, it will suffer irreparable harm,
and 2) that a sufficiently strong causal nexus relates the alleged harm to the alleged
infringement.” 695 F.3d at 1374. Judge Koh ruled that Apple failed to meet the
second requirement, because:

But
even if design was clearly a driving factor [in customer demand for Apple
smartphone products], it would not establish the required nexus. The design of
the phones includes elements of all three design patents, as well as a whole
host of unprotectable, unpatented features. Apple makes no attempt to prove that
any more specific element of the iPhone’s design, let alone one covered by one
of Apple’s design patents, actually drives consumer demand. The Federal Circuit
made clear in Apple II that customer
demand for a general feature of the type covered by a patent was not
sufficient; Apple must instead show that consumers buy the infringing product
specifically because it is equipped with the patented feature. 695 F.3d
at 1376.

Instead,
Apple argues that its patents “cover the iPhone’s most prominent design
elements,” Reply at 3, and therefore, if design drives demand, so do the
patents. Even if the Court accepted as true Apple’s contention that the patents
cover the most central design features, it would not establish that any specific
patented design is an important driver of consumer demand.

Order,
at 8-9. The court also ruled that Apple failed to establish that Samsung’s
infringement of its utility patents caused an irreparable competitive injury.

Second,
the court noted that Apple had previously licensed design patents, utility
patents, and trade dress that collectively formed the iPhone “user experience,” and
that practice weighed against granting injunctive relief. Thus, it concluded, “Apple
does appear willing, at times, to use its patents, including several of the
patents at issue here, and even its trade dress, as tools in forging
relationships and generating income. Further, Apple has agreed to licenses with
companies with whom it competes, including Samsung.” Order, at 17.

Third,
the court noted that the standard for an injunction after eBay may be a very
difficult one for a patentee to meet when a patent covers only isolated components of a
complex product:

The
phones at issue in this case contain a broad range of features, only a small fraction
of which are covered by Apple’s patents. Though Apple does have some interest
in retaining certain features as exclusive to Apple, it does not follow that
entire products must be forever banned from the market because they
incorporate, among their myriad features, a few narrow protected functions. Especially
given the lack of causal nexus, the fact that none of the patented features is
core to the functionality of the accused products makes an injunction particularly
inappropriate here.

Order,
at 22.

Essentially,
Judge Koh’s reasoning requires a patentee to present specific evidence establishing that a particular
patented feature is the determining factor in customer purchasing decisions.
Given the incredible complexity of features and functionality in many modern
products, and the spectrum of different customer preferences and values
affecting the purchasing process, what sort of evidence could ever meet the
court’s causal nexus requirement?

Thursday, 13 December 2012

In the case 4 Ni 43/10 (EP) "Bearbeitungsmaschine", the fourth senate of the Bundespatentgericht has rejected a new document as being late filed by applying the new rules for the German nullity procedure briefly discussed here.

While this alone may be already considered interesting for poeple used to the traditionally generous attitude of the Bundespatentgericht with regard to late filing, the even more intersting part of the decision is the senate's argument why the excuse presented by the plaintiff was not sufficient.

Our caselaw on novelty and inventiveness is based on the hypothesis that the person skilled in the art is aware of or is at least able to easily find every piece of prior art in his technical field. Some of us may have had doubts whether this assumption reflects the actual knowledge of a real-life engineer but a defence based on the argument that the inventor was unfortunately not aware of the most relevant piece of prior art is clearly doomed to failure in most jurisdictions.

In the case at issue, the plaitiff had argued that the document submitted lately was found only by chance and only very late despite of having taken all due care. The Bundespatentgericht rejected this excuse by referring to the principle of equality of arms ("Waffengleichheit"). It would be unfair to support an attack on the above hypothesis that the skilled person would have found the document easily while at the same time using problems to find the document to support the plaintiff's case.

Thursday, 6 December 2012

Given that November in
Karlsruhe is very much alike November in the rest of Europe, our readers might
find it not very surprising that the Xth senate of the BGH was very much interested
in cough syrup the last days.

Cough syrup
smells like eucalyptus and citrus fruits ever since this blogger can remember. It is therefore more surprising by far that the EPO has granted a patent in 2004 with a
claim 1 reading: “A pharmaceutical composition for administration in the form
of hard or soft gelatine capsule comprising eucalyptus oil and orange oil.”

Gelomyrtol, a product
that smells like eucalyptus and orange oil, was available in the form of
capsules long before the filing date of the application. Was its composition
available to the public?

Well, a simple-minded
ordinary man would say if it smells like eucalyptus and orange oil then it
contains eucalyptus oil and orange oil. What else?

The official
pharmaceutical description (“Rote Liste”) mentions that Gelomyrtol is a plant
extract containing inter alia substances called d-Limonen (which makes up 90%
of orange oil), a-Pinen and 1,8-Cineol (the main ingredients of eucalyptus
oil).

In the nullity
proceedings, the patentee argued that despite of the suspicious scent and the
revealing chemically pure ingredients, the mix of essential oils could have
been synthesized otherwise than by mixing eucalyptus oil and orange oil such that the composition was not directly and unambiguously derivable for the skilled person (in particular by a skilled person with a stuffy nose, I would like to add).

The senate did not
follow this argument – but did not rely on their noses either. Actually the
judges did not even mention the fragrance but found that the indications in the pharmaceutical description were
sufficient for the skilled person to establish a manageable number of
hypotheses on the potential composition, one of which could then be confirmed with
the available analysis tools. These tools, again, did not include the nose but
rather gas chromatography and mass spectroscopy.

Wednesday, 5 December 2012

Yesterday evening the IPKat picked up a story from Maxine Horn (Creative Barcodes) and Crowdsourcing.org on the patent infringement suit brought by 3D Systems against not just its three-dimensional printing rival Form Labs but also against crowd-source financier Kickstarter. The thrust of Maxine's case is that, since Kickstarter is effectively neutral to the alleged infringing acts committed by Form Labs -- it plays no part in the running of that company and derives no income from its infringing or non-infringing trade -- it should not be vulnerable to patent infringement litigation.

The IPKat is hosting a side bar poll on itshome page which expires next Wednesday, asking whether ventures such as Kickstarter should be completely, partly or not at all exposed to the risks and expense of patent infringement litigation. If PatLit readers would like to participate, or just add a comment concerning their own thoughts or experiences, they should feel free to do so.

Tuesday, 4 December 2012

In
an attempt to modernize the nullity procedure at the Bundespatentgericht, the
German Patent Act has been reformed with effect as of October 2009. New
features include the issuance of a preliminary opinion of the
Bundespatentgericht (§ 81(1) PatG) identifying the points considered by the
senate to be of particular relevance for the trial as well as improved
possibilities of the BGH acting as the 2nd instance to reject new
matter as late-filed (§ 117 PatG).

In the case at issue,
a supplementary expert opinion was submitted in the 2nd instance. The
supplementary expert opinion sought to clarify and concretize issues addressed in
an earlier expert opinion of the same (privately appointed) expert submitted in
the 1st instance at the Bundespatentgericht. The BGH found that
clarifications, explanations and concretizations of matter discussed in the 1st
instance are not considered as new matter.

Further, the plaintiff
had brought forward a new novelty/inventiveness attack which was, however,
based on documents which had already been in the 1st instance
procedure. The arguments were considered new matter.

According to the now applicable
German Code of Civil Procedure
(ZPO), new matter may be admitted in the 2nd instance inter alia if
the failure to bring the matter forward in the 1st instance is not
the result of a negligence of the submitting party.

In the case at issue,
the Bundespatentgericht had expressed its preliminary opinion that the main attack against
the validity brought forward in the 1st instance was convincing and
finally decided to basically follow the plaintiff’s request. The BGH found
that, given that the main attack was successful in the 1st instance,
there had been no requirement for the plaintiff to submit auxiliary lines of argument.
As a consequence, the failure to submit the new arguments in the 1st
instance was not negligent and the new matter was allowable.

The BGH and the
Bundespatentgericht clearly want to avoid excessively voluminous files resulting
from parties submitting each and every possible argument even on the most
remote aspects of the case. However, the allowability of the new argument could
have been more problematic if e.g. the senate of the Bundespatengericht had
changed its mind during the oral proceedings.

The lesson to learn is
that a party might keep some trump cards up the sleeve when it is on the winning
road. It is, however, better to play out everything you have if the preliminary
opinion of the Bundespatentgericht is not favorable four your party at the
latest.

Last year the United Kingdom's Supreme Court in a copyright case held that there was no doubt that the modern trend was in favour of the enforcement of foreign IP rights and that there are no issues of policy which militate against it -- nor is there any objection in principle. This could be different, the Supreme Court considered, where issues of validity are engaged (see Lucasfilm v Ainsworth, 27 July 2011, paras 108 and 109).
Last week in Actavis v Lilly the High Court of England & Wales in a patent case held that it had jurisdiction to decide on a declaration of non-infringement not only regarding the GB part, but also regarding the French, the German, the Italian, and the Spanish part of the European patent at issue.

In Actavis v Lilly there were no issues of invalidity engaged because the plaintiff, Actavis, didn’t raise them and the defendant Eli Lilly didn’t either (they were the patentees, after all). Therefore Article 22(4) of the Brussels Regulation on Jurisdiction, which provides that validity is the exclusive domain of the country of registration, did not come into play. Lilly accepted this.

English service practice; English doctrine

The decision is not really concerned with cross-border issues under the Brussels Regulation on Jurisdiction (BR). It rather turned on issues of service and jurisdiction under English law. That was because Eli Lilly was a US domiciled entity which had not committed a tort in England, so that the Articles 2 and 5 BR could not be used as a basis for jurisdiction. Further to Article 4 BR the question then became whether the English court had jurisdiction against Lilly under English national procedural law. To establish this, the decision goes at length into all kinds of particularities of English procedural practice and law.

The first conclusion – based on correspondence between solicitors - was that Lilly had consented to being served in the UK and that, even if that would not have been the case, Lilly had been validly served in the UK because its European patent department constituted a place of business in the UK, proper for service. The second conclusion – based on the common law doctrine of forum non conveniens – was that the English court had jurisdiction over Eli Lilly for the cross-border non-infringement claims. This is where the Lucasfilm decision was leading.

Race to the Courthouse

Both conclusions were equally important because there had been a race to the courthouse: having been put on notice by Actavis’ solicitors of its London cross-border non-infringement desires by letter of 12 July 2012, Eli Lilly instructed its German lawyers to file an infringement suit against Actavis in Düsseldorf. As it happened, the English team won the race: the English court was seised of the non-infringement matter on 27 July, the German court of the infringement matter on 31 July.

Since the London court also held that it had jurisdiction regarding the German non-infringement claim, under Article 27 BR the Düsseldorf court would have to suspend its proceedings until the decision of the English court on jurisdiction has become final.

The applicable laws

The 27 November decision contains some considerations on the applicable law and procedure. Further to EU Regulation 864/2007 (Rome II) the court will apply the relevant foreign laws to the cross-border parts of the claim. That is not a problematic prospect since Article 69 EPC (scope of protection) must be uniformly applied in every European country. As to any procedural and remedial questions the London court will apply English law as the lex fori. Both these positions (substantive law and procedural law) were common ground between the parties, as the decision records at the outset.

Artcile 69, Article 22(4), and Solvay v Honeywell

The decision spends a few words on the argument – ran by Lilly in the course of their forum non conveniens defence – that, even though validity was not challenged, under French law validity was relevant nevertheless because in France the prior art has to be taken into account when determining scope of protection, so that Article 22(4) – forcing the English court to stay the cross-border non-infringement proceedings -- would come in via the scope door.

The Patents Court (Mr Justice Arnold) was not impressed by this argument. One, the evidence cited for ‘the French approach’ to Article 69 was “less than compelling”, and two, the validity factor does not make any real difference for determining that the foreign court is the more appropriate court (as part of the forum non conveniens argument). For this conclusion the decision “by analogy” relies on the CJEU decision in Case C-616/10 (Solvay v Honeywell).

Solvay deals with a foreign invalidity defence raised in the course of proceedings for an interlocutory cross-border injunction. In case provisional jurisdiction is based on Article 31, the CJEU in Solvay held that the infringement court would not have to stay the cross-border part of the case. It is difficult to see an analogy with the Lilly situation (which, after all, was a case on the merits to which Article 31 was wholly irrelevant). Perhaps it was just that the English court felt more at ease to dismiss the Lilly ‘invalidity via the backdoor’ argument because Solvay did open some of the cross-border doors which GAT/LuK (Case C-4/03) had closed.

Conclusion

For a Continental observer it is difficult to judge the merits of the Lilly decision as to English proper service and forum non conveniens considerations. As to its cross-border consequences the decision should not be surprising, however. It is in line with the conclusion which under the Brussels Regulation has been confirmed to be the law several times: If there is jurisdiction based on domicile, the extent of this jurisdiction is worldwide and cannot be restricted on forum non conveniens grounds. See, for example, CJEU Cases C-69/93 (Shevill v Presse Alliance, 1995) and C-281/02 (Owusu, 2005).

Thanks so much, Richard, for your thoughts and analysis, which are very much appreciated.

Readers may also want to take a look at this note by the AdvoKat on the IPKat weblog here.